Tokyo Lifts Stock Margins

Published: June 3, 1988

The Tokyo Stock Exchange said yesterday that it would raise the margin requirements for stock purchases to 70 percent from 60 percent to try to slow the recent rapid increases in share prices and volume.

Officials of the exchange said the move had also been prompted by a substantial rise in margin transactions.

The move was not the first effort by the exchange in recent weeks to reduce the extent to which investors were using credit to buy stock. But the previous attempt failed to slow its market.

On May 16, the exchange raised the margin requirement to 60 percent from 50 percent. The next day, the Nikkei average of 225 stocks rose 167.86 points to exceed its closing level on the day before the market collapsed in October. It rose another 93 points the next day and then surged 1,001 points in three sessions early the next week.

The latest change in the margin levels returns the Tokyo exchange to the same requirements it had before last September, when it was trying to increase investment. The exchange reduced the margin levels to 50 percent from 70 percent last fall.

David S. Ruder, the chairman of the Securities and Exchange Commission, said the announcement was an attempt by the Japanese to slow their market. The move is ''likely to be an indication to dampen speculative activity in the Japanese stock market, which has gone up over its pre-October highs, certainly not a situation our stock markets are in,'' he said.